Question about how DOFD is determined in car repo situation

[Anonymous]

I'm officially free from any negative after requesting Equifax to early remove my last collection account with Portfolio from my report. It was a long journey.  Anyway, I have a quick question for the pros out there.  My brother had his car repo back in 2015 by Ally Financial.  Viewing his credit Equifax report, his last payment was made in March of 2015.  Starting from April of 2015 and on, the report listed 30 for April, 60 for May, 60 for June, and 90 for July.  I do not know why there were two 60 days late.  In August, it is listed as CO, so I assume that it has gone to collection.  From my understanding of DOFD, the DOFD should be the day that he stopped paying, so that would be in April of 2015.  However, his Equifax report has the "Delinquency First Reported" as of August 01, 2015.  Is this correct and that I misunderstood what DOFD is all about?  The reason why I asked is that lately, Ally Financial has been sending lots of letters offering payments and such.  He hasn't replied to any of those letters yet.  He wants to make sure that he's out of the state statute of limitation before contacting them to offer a lesser settlement amount than their proposed amount.  Can someone please clarify how the DOFD is determined?  

Thank you in advance for your help!

[RobertEG]

The formal definition of what is commonly called the date of first delinquency is set forth in FCRA 605(c), and is expressed in terms of the date of commencement of the period of account delinquency that includes the reported date that the account was charged to profit and loss, or its equivalent.

Interpretations by both the FTC and courts have routinely and consistently clarified that the date of first delinquency is reset when a debt is returned to pays as agreed, good-standing, and a new first delinquency begins each time the account again becomes delinquent.

A repo can be reported simply as a repo or as a charge-off.  If the repo represented a loss, then the DOFD that applies to the exclusion of the repo would be the date that the first payment became delinquent, and the account remained delinquent up to the time that the vehicle was repossessed.

The date of last payment will not be the DOFD.

If the last payment was sufficient to maintain the account in pays as agreed, good-standing, the date first delinquency would not occur until the billing due date of the NEXT payment that was due, and that date or amount was inadequate.

The billing due date that was missed would then define the begin of the period of delinquency that led up to and included the repossession.

For numerous reasons, you cannot use a reported payment history profile in your credit report to determine the specific DOFD.

The creditor is required under FCRA 623(a)(5) to separately and specifically report the account date of first delinquency to the CRA no later than 90 days after reporting a derog that is the equiv of a charge to profit and loss.

A 30-late, for example, is not the month that the account first became delinquent, it is a month later.

Additionally, there is no requirement that the creditor actually report a 30-late the very first month that an account becomes delinquent.

CRAs thus dont infer DOFD from a payment history profile.  Rather, they use the separate and explicit reporting of DOFD that is required to provided by the creditor.

If you have documentation showing when the account first became delinquent, and that it thereafter remained delinquent up to the time of the charge-off or its equivalent, then you can dispute the DOFD that has been reported.

It is then determined by account records, and not from reported payment history profile.

[Anonymous]

Thank you Robert.

I'll let my brother know.  I doubt he has any document on hand to dispute the DOFD.  Can he just dispute the DOFD without any document to submit to Equifax or the the reporting agencies?

[RobertEG]

If he has no documentation, he will still need some basis to show how it is inaccurate, which is usually by a factual showing of what the actual account records document as evidence of the date of initial delinquency, with continued delinquency thereafter.

He could argue based on the reported payment history profile.

Although a payment history profile is not definitive documentation of actual DOFD, it is at least a logical starting point, and would likely result in the CRA at least not holding the dispute as lacking in any support, and thus frivolous.

Make the argument that the DOFD is one month prior to the first reported 30-late, and hope for the best......